A Missed Opportunity on Climate Change (climate bill may be worse than nothing at all)

[OKIsItJustMe]

http://www.nytimes.com/2009/08/09/business/economy/09view.html?_r=1&hpw

August 9, 2009
Economic View

A Missed Opportunity on Climate Change

By N. GREGORY MANKIW

DURING the presidential campaign of 2008, Barack Obama distinguished himself on the economics of climate change, speaking far more sensibly about the issue than most of his rivals. Unfortunately, now that he is president, Mr. Obama may sign a climate bill that falls far short of his aspirations. Indeed, the legislation making its way to his desk could well be worse than nothing at all.

Let’s start with the basics. The essential problem of climate change, scientists tell us, is that humans are emitting too much carbon into the atmosphere, which tends to raise world temperatures. Emitting carbon is what economists call a “negative externality”— an adverse side effect of certain market activities on bystanders.

The textbook solution for dealing with negative externalities is to use the tax system to align private incentives with social costs and benefits. Suppose the government imposed a tax on carbon-based products and used the proceeds to cut other taxes. People would have an incentive to shift their consumption toward less carbon-intensive products. A carbon tax is the remedy for climate change that wins overwhelming support among economists and policy wonks.

When he was still a candidate, Mr. Obama did not exactly endorse a carbon tax. He wanted to be elected, and embracing any tax that hits millions of middle-class voters is not a recipe for electoral success. But he did come tantalizingly close.

…

[bananas]

1. Mankiw wanted to reclassify burger flipping as a manufacturing job

At the end of the article:

N. Gregory Mankiw is a professor of economics at Harvard. He was an adviser to President George W. Bush.

From Sourcewatch:

Gregory Mankiw

Professor N. Gregory Mankiw is the Robert M. Beren Professor of Economics at Harvard University. <1> From May 29, 2003 to February 18, 2005, he was the Chairman of the US President's Council of Economic Advisers.

In 2004 he caused controversy by suggesting that outsourcing of jobs by U.S. companies is "probably a plus for the economy in the long run". <2>

He is also famous for suggesting that flipping hamburgers is a manufacturing job, and should be reclassified as such. <3>